koyasan

I totally agree with you but does DAVT break any Forum rules? I think he does as he fails to provide any logic or rationale for the claims he makes and therfore falls short on the following rules..... "We strive to maintain a high standard of education and discussion on the site. Traders Laboratory reserves the right to remove any post/thread that deems unsuitable of the quality of the board." Clearly there is no educational benefit to this thread and DAVT will not enter into a two way discussion of what he claims to be a sucessful method of trading. I'm not in favour of censorship but at the same time what is the point of agreeing to rules of the Forum if they are not enforced? Perhaps it is time for the Forum administrators to make it clear that this is a professional forum for discussing trading and not a platform for the delusional.

I've quoted just a line of what you said because it really does'nt hold up. If I spent the time to be very specific about how I trade it only proves one thing..that I can be specific about how I trade. It does not prove that my method is profitable either for me or for you.For that to happen you would have to follow my methods exactly and risk your hard earned cash to prove me either correct or wrong. Why on earth would you do that? Look at my earlier post for the stranger knocking on the door scenario.........what about the reverse? I knock on your door and tell you that I have a winning system and if you have a spare $20000 in a broker account you can try it out.........if it works you can make a living and if it fails..... well who knows what drawdown you would have. You would be mad to take me at my word. Joseph, I will concede that you do have a point about some people who claim to have a winning strategy but are short on specifics. For whatever reason (who cares?) they derive some benefit from saying they are one thing when the opposite is closer to the truth. However I think you should acknowledge that there are people here that are sucessful and have very sound reasons why they do not post the specific details of their strategy and that too has to be respected. Any one can ask any question they like without an obligation on anyone to post the answer. Not posting an answer does not mean they are fraudsters. I claim to be a successful trader and you want me to prove it by being specific about my strategy. I hope now you will rethink that the proof of being profitable goes beyond being specific. Of far more value is my rationale for trading and I've already given the details in my earlier post. I only trade Aud/Usd futures....30min time frame...identify trend (long or short)...enter on first pull back......look for risk reward min 2:1. Of course I am short on detailing specifics but I'm not sitting down to write a book...........which is why to show good faith I have also offered to be specific in an answer to a specific question you might have (I assume you are really interested in specifics?). Maybe I am not a sucessful trader and maybe tomorrow morning I am flying off to beautiful Chiang Mai paid for by income I have made outside of trading. Maybe tomorrow morning I am going nowhere and I'm really typing this when the warden is having his break. At my age I have nothing to prove to anyone. Whatever you choose to believe I am off line for the next week.....but I still hope you will give me the opportunity to answer a specific question you may have about my trading. Meanwhile why don't you share at least your rationale for your trading?

Don't be fooled by the title of this thread ..you've just done the equivalent of Curiosity landing upside down on Mars. Respectfully suggest you flip over, take off and land on any other thread on this forum............there is a mad Martian heading your way.

I'm not saying your remarks are aimed at me but they certainly don't apply to me. I've given the reasons why I personally don't spend the time explaining my system and I have given the rationale behind how I trade. The point I am trying to make is that there is no secret about trading , it is all about accepting a certain logic in the market (in my case trend trading) and working hard to translate into a setup and execution. To show my good faith this is my challenge to you..........read through my posts about my rationale and ask me one very specific question about any aspect and I will give you a very specific answer.......so you do the work regarding what you regard as a key question and I will give you my answer......just don't expect me (or anyone else) to write a manual for you otherwise we are back to the stranger knocking on the door scenario.

I like to believe in ghosts,in dreams,in mythology and the hero's journey. However I have long realised that trading strictly belongs in the real world and provides only the means for my indulgence in the other.

I think 1) applies more to institutional traders and 2) is rightly assigned to the delusional. However I believe there is a significant number of successful retail traders who do not post their winning system and I include myself among them. My reasons are to do with boundaries. A stranger knocks my door and tells me he has heard thet I make my living from trading and asks me to write out the details of my system so that he can be as successful as me. He also tells me that he will be back for further clarification and would I kindly keep him updated on any new tweaks I make to the system. Sure, no problem and thanks for calling. Of course in real life a stranger would not knock my door with such a request but on the internet there is a pseudo intimacy which respects few boundaries. I've already gone further than my parents by 'talking to strangers' but sure as hell I'm not letting them into my home. Sucessful traders are hard working, focused and passionate and do share ideas and opinions but benevolence is reserved for the charities I support. This is not an uncaring attitude and I've already mentioned in an earlier post on this thread how 'I fish'. I identify a trend and trade pullbacks.As long as the trend has more than one pullback I can make money on every trend except for the final pullback which turns into a trend reversal. There are numerous ways to identify a trend early enough to benefit from it and numerous ways to identify pull backs.Even a canned version of this could use Dow theory and a trend line and make money. If wannabee traders focused on this I am sure they could develope their own winning system and I do believe that ownership is central to success. However go to a bookshop and look at the books devoted to diets and weight loss. The simple winning formula to lose weight is eat less and exercise more but who wants to hear that? Trade pullbacks in a trend.........start asking and answering questions around this and if you are as stubborn as me you will come up with your own winning system. No majic but just like losing weight it's all about hard work.Asking me to share my winning system is asking me to do the hard work for you.

...............under pressure and over time every chain exposes a weak link...........all chains by definition have a weak link......an alternative solution is perhaps to find a way to play to the strengths of the trader within the trading system and therfore preserve the integrity of the chain?

DA.....no old friends and no new friends...ok so let me ask you another question ..lets say one of those 'pompous fools' had a strategy which continually lost money but they refused to change their strategy (you and I know these people exist)........DA, you are obviously no fool so if your strategy for finding friends is not working you have to transfer your skills as a trader and apply it to the business of finding New Friends. Respectfully suggest you drop your present strategy.............regroup.....and come up with a better line than "BTW:NFW(new friends wanted)"...I know you are an accomplished trader (stating the obvious) so I look forward to your creative mind coming up with a new strategy fo finding new friends......go for it DA and prove to the 'pompous fools' that you are not one of them! As always consider carefully........

I hear you...life is not just about making money...people matter......but think about this carefully. After a hard (but yet profitable) day when you are relaxing alone in your back garden admiring all those daisies, ask yourself a simple question. What happened to your OLD FRIENDS?

Predictor...thank you.......enjoyed your post..years of experience has obviously given you an intuitive feel for the ebb and flow of the market as your style of trading goes beyond a pure rules based approach. In the end a consistently profitable system is a valid system. However by definition experience is acquired over time and intuition cannot be taught so I presume you teach a profitable version of non discretionary/mechanical trading? I think the answer is in your question......perhaps because it is profitable? Which rules do you not follow, how much discretion do you use, how much adaptation do you employ and what information are you referencing in order to 'read' the market?. I accept that this works for you but going back to my earlier point this is not something you can teach or indeed is helpful to a novice/intermediate trader. I would hope nobody trades this way. I would suggest that the mechanical trader in your example is a wannabee trader without a viable strategy and hardly a useful comparison to your own style. On the other hand I am more of a mechanical trader. I view the market as a technical challenge, the goal of which is to achieve profits with the least expenditure of capital and mental/emotional energy. I follow my rule based system developed from the only information which I have, which is what has gone before. My system evolves as tomorrows data becomes yesterdays. I take every trade I see and I end up winning more than I lose. There certainly is no right or wrong about your approach or mine.....profit is all that matters.

Financial pressure just to pay the bills puts enormous stress on personal health and relationships. Around 50% of Australians don't have private health cover and even less have any access to regular dental treatment. I do believe that health is your wealth but it is a myth to claim that it comes free. Money buys me the option to choose and if I choose wisely then my life may be more fufilling, perhaps I might experience peace of mind and even moments of happiness. Every year I visit my parents who live on the other side of the world....the last time I looked tickets cost money. A few years ago my wife was quite ill and even with private health cover there was a large financial gap. Nothing makes me happier than travelling and exploring the world.........cost money. You certainly can't buy happiness but not having to count the pennies goes a long way.

Rande....enjoyed your article and thought provoking as always, though it takes a few reads to really get to grips with what you are saying. If I have got this right, once a trader is 'good enough' (to use the term in the Winnicott sense) on the TA side the only (and greater) challenge to success is the mental game which you define as , " redeveloping his beliefs about his capacity to truly manage uncertainty". The goal as you see it is to develope a mindset of 'disciplined impartiality" which is possible for the trader to achieve if he is motivated by a passion for trading. I'm with you so far and would not disagree. On the TA side I think there are a lot of traders who have sufficient knowledge re strategy,set ups, money management , back testing etc which is not reflected in their trading accounts. If anything I probably spent more time on TA looking for 'certainty' as a way to avoid the mental stress of 'managing uncertainty'. After all if I had a surefire strategy then there is no stress in the execution. Equally when I am under more stress managing uncertainty it explains why I might go back to working on the TA side of the equation. I agree with you that there comes a point in our trading when we realise that it is now time to spend more time on the mental game..the TA side is 'good enough' to make money. There is also a hidden caution in your post which suggests it is probably pointless to concentrate on the mental game until you have demonstrated competency on the TA side. Not sure how you would measure this but I agree with the sentiment. Just wonder how would you recognise someone who is competent on the TA side but dos'nt believe it and what about the person who has the mental game but not the TA? On this latter point since the TA side is probably easier is it theoretically possible that the journey for you to become a successful trader is a shorter one? That's a serious question because for me it might help to clarify the process of how to become a successful trader.

Since I posted ( genuinely surprised and grateful for such positive responses) the debate has moved on and I thought I would just add a few comments. Sharing my strategy: I am not trying to be coy about this or holding out for someone to pay me for my 'secrets'. I also have no interest in publishing or teaching my strategy for free or otherwise. I make enough money from my trading to live comfortably and to do other things apart from trading. Secondly there is nothing secret in my strategy that you won't discover for yourself if you have a curiosity about the markets and prepared to put in the work. The Logistics of Sharing my Strategy: Lets say I have made more money than I would ever need (unlikely as my other half spends it as fast as I make it) and decided to gift my strategy to the world. I would be giving you one A4 sheet of paper which lays out my rules for set up, trigger, profit targets, money management etc. I would also be giving you my default template in Metastock 11 code containing five indicators, only one of which is my own invention and not in itself a critical component ( but it's my baby,a volume derivative indicator used for confirmation of trend,). The template is simple and clean but the codes behind the indicators are complex. To apply my strategy (as I use it) you will need Metastock Pro version 11, real time data North American subscription and CME futures real time data and a brokerage account to trade Futures. I'm sure my strategy could be applied to other platforms but that's irrelevant to me. Wherever you live in the world you must have the time to watch the markets at least during London time and preferable also New York times though some good set ups do occur during Asian time. If you are still with me, what I can't teach you is the discretionary element in my trading which although minimal is still vital for my success. My discretionary element comes from an understanding of the maths behind each indicator, how they interact to sometimes give false signals and the experience which comes from watching the market and knowing the subtleties of the market I trade (AUD/USD Futures). I also cannot teach you how to trade, I cannot teach you how to accept risk when you are pulling the trigger on the right hand side of the screen. I cannot teach you how to cope with even buying one Futures contract when seconds after you have bought you might be down $100 (roughly 10 ticks) or how not to close a position even if you are up $500, now try multiplying that by 5 contracts. Also what I can't teach you is how I tweak my strategy in line with a market that changes over time due to fundamentals. My strategy is no different from last month but very different from 4 years ago. I also know that my strategy will raise more questions that it answers depending on where you are in your trading experience and I can't fulfill that demand on my time. There are people on this Forum that are still with me and may easily have more knowledge and experience than me. If they saw my strategy they would I think say it makes perfect sense and is sound and will work, but not a single original idea in any of it (except for my Vol Indicator which is not critical). For everyone else I believe there is no way they would invest the time and money to make my startegy work for them, they might still be looking for a 'magic indicator'............most people don't even like Metastock or have the margin capital for Futures Trading. This is really the heart of the problem with trading. As Predictor says in the previous post it's impossible to teach you how to trade in a few words. I want to share an example of how a strategy is not the same as knowing how to trade. Quite a few years ago I was fasinated by Bill Williams (Trading Chaos etc) and read everything that he wrote. I must have spent six months of my life trying to understand his strategy and applying it. I understood everything, and had all the codes on Metastock and I promised myself that I would use part of the expected trading profits to invest in my own education and fly over to one of his trading weekends. The only problem was I never made a single dime , big fat zero. If anything I had a few nightmares about being eaten alive by one of Bill's big Alligators. The twist to this story is that I took the book off the shelf a few months ago, managed to get past my phobia of Alligators, and in a matter of a few hours using a small Forex cash account I made some profitable trades. I was never going to go back to Trading Chaos and of course Bill's stuff was still the same, but it was me who had changed. I could make an average system work. I'm no 'Tiger Woods' of Trading but give Tiger just a putter to play a round of golf and I bet you he would still put in a decent score. So pointless and impractical for me to share my strategy but at the risk of dissapointing a lot of people I will happily tell you the logic. I trade for the most part with the Trend (either Short or Long) entering on Pullbacks, that is it. I trade only AUD/USD Futures on 30min time frame becasuse the trends are common and balances well with risk. My strategy concentrates on how to identify a trend early enough to enter a trade, how to identify a Pullback and above all how to assess risk to minimise the drawdowns when I am always wrong towards the end of the trend. I have my own way of achieving these tasks and my methodolgy does change over time as I have said but the basic logic is the same and I suspect always will be. Other traders have their own methods but if they are Trend traders they are bacically doing the same thing as I do. As I have said before there really are no secrets, do your own homework on your own instrument on your own preferred platform and put in the practice hours and you can if you want to make money in this game. Final thought.......why do I need to bother with Forums? For the same reason I still read trading books, avidly read magaizes such as S&C Magazine and spend countless hours looking at other markets, watching charts and trying to improve my ability to construct and write code......there is always something to learn from everybody no matter where they are in their trading experience (even, if only how not to do it)..........I put in 50/60 hours each week to maintain 'success' , I avoid complacency, I take nothing for granted and I never fall into the trap of thinking I have 'arrived'. Success never comes cheap but the biggest investment is your time.

I have a strategy that works. I know it works because I make my full time living from it and have been doing that for the past four years. Before that I was part time. I trade only Aud/Usd Futures and typically I get one or two set ups a day,. though occasionally nothing happens. Most of the time I just wait on something happening and quite often I miss a set up because I'm just too tired (I trade Aussie time so often a good set up happens after midnight my time). No magic at all in my system.I have an edge and I work hard to keep it. I occasionally post here because I am bored watching my chart (yes just one chart, on one time frame with dare I say it, indicators and not a whiff of Sam Seiden in sight). If I could retire from this it would not be a day too soon. Don't get me wrong, I am privileged to make my money this way and I am fasinated by the the challenge of TA but hardly bettering humanity in the process and besides I am really a 'people person' so watching a computer is fasinating but not exactly life fulfilling. I trade to pay the bills and pamper my passion for travelling. Given that I am on the wrong side of 50 I am basically unemployable in any case. Just in case you think I am sounding blasee about all of this 'success' I should add that I have spent 1000's upon 1000's of hours pouring over charts and designing and testing my own system. I have spent sleepless nights after suffering massive drawdowns and at times I have felt like it was just all too much and that it was not possible to make any sense of the markets..........just all too random. In the end I have devised a system which follows simple rules and has minimum discretion,though the system is very far from simplistic. So why don't I just tell you my system and let everyone at least test it or profit by it? I suppose the answer is "Why should I"? Yes I could start my own blog/thread and make it my mission to teach my system.....but for what purpose? To feed my ego? All I really need is to feed my family. In any case someone is bound just to repackage my system and sell it to someone else or more likely not have the discipline to make it work and therfore declare it as 'useless'. I might sound cynical but anyone who has been trading for a few years and is still surviving will know what I mean. So yes, it is possible to have a strategy that works but it requires an awfull lot of work to finally come up with a strategy (which incidentally is always evolving to some extent) and a lot of courage (and money) to turn a strategy into making a living. There are few shortcuts in this game.

I'll answer according to my own experience: At one time I did not trade my plan because I did not believe in it and had no confidence in it though at the time I would not admit that. Unfortunately I started trading during the late 1990's when the only plan was to pick anything and go long so I had really bad habits confusing success with luck. It has to be profitable with acceptable drawdown (my personal max tolerance is 20%, that's not individual trade tolerance).It has to be robust (minimal curve fitting) in all conditions showing a smooth equity curve and to execute requires minimum amount of discretion (if any). If it can be coded then backtest in all conditions. (you need a good backtesting system that can test for drawdown,risk/reward ratio,profit/loss,win ratio, etc). If it can't be automatically backtested then you have to manually pour over the charts (great learning experience). My confidence comes from backtesting a plan and then roadtesting with real money (low leverage test account) before moving on to multiple contracts. I use a cash forex account for testing and trade Forex Futures to make a living. In the end there is no substitute for the confidence that comes from designing my own plan and seeing it work in real market conditions.

Interesting that the Turtle Trader experiment is being run again based in the UK (The New Turtle Traders). The organisers (Mike Baghdady and Training Traders) "believe that trading is a teachable and trainable skill" through a hands on mentoring approach. Whatever we might believe about trading as being akin to an art form there our others who break it down into a pure skills set which if taught properly will result in making consistent profits. Maybe the real benefit of mentoring is not the methodology (which we can all understand) but the confidence which comes from working alongside a trader who knows what he is doing. Gaining that confidence on ones own is often a longer process. Basically I am self taught but looking back I believe that a mentoring program would have been more efficient both in time and money though I accept the point made by SIUYA that opportunities for apprenticeship are scarce. If I had the opportunity to be properly mentored I might not be a better Trader than I am now but I certainly would have got to where I am now a lot quicker.

I think it is still useful to offer suggestions (if asked) on how to tackle the task of becoming a trader, if only to share what we know from our own experience. Not the same as offering suggestions on how to trade which I would be reluctant to do. Totally agree with your second point that sometimes the best thing is to move on to something else...the 'positive attitude' mentality which never gives up can be delusional.

Is 'don't get in his way' not a suggestion that the best way to learn is for the wannabe trader to figur it out for himself ? I'm simply saying that self education is expensive and inefficient and why does every wannabe trader have to reinvent the wheel? Is there nothing that those of us who have tasted success and failure discovered that is worth suggesting? Is trading the only profession in the world where every new trader has to work it out for himself?

I think I know what you are getting at. My life experience and education has basically given me the ability to learn, the structure to acquire and apply new skills, the methodology to research and extract relevant knowledge. Add to that mix a determination to succeed, adequate financial capital and a clear objective to make a profit and you think I have every chance of becoming a successful trader? It's possible , if of course I don't blow my account in trying or spend it all on useless 'education'. Let's say that becoming a trader is not the same as becoming a brain surgeon...if it requires the same amount of skill/learning I would quit right now. In my lifetime I have trained/worked as a teacher and as a psychotherapist so let's assume becoming a trader is no more or less a challenge. Here is the difficulty......where do I go from here to learn my new profession? Imagine asking a student who wants to become a teacher to wade through chat forums, study from home, read a mountain of books full of contradictions or sign up to some Guru who wants you to travel half way round the world to learn the secret in one weekend. Alternatively you are told that there is no 'one way' to become a teacher but you have to see what fits with your personality. Imagine after years of floundering around in self education (assuming he has'nt already given up) this trainee teacher is finally put in front of a real class of students? Yes, you need organisational skills, core principles or whatever but what is lacking is a recognised proven program where I can learn how to become a trader (I can just hear the testimonials/reccommendations to follow). Of course there are loads of fancy titled virtual reality 'Trading Academies' etc .with about as much credibility as the hundreds of Learning English as Second Language schools here in Australia. Of course it is still possible to become a successful trader but because of the lack of credible external structure most (irrespective of existence of core attributes) will never make it through the expensive and inefficient process of self education. As a footnote, I am a full time trader and I am still (and probably for ever) in the process of becoming more successful but I would never reccommend anyone to learn the way I did. If I had to do it again maybe I would hope for a face to face apprenticeship or mentoring program from a trader who would first allow my accountant to do due diligence on his/her trading accounts. Let's say a person has made the 'meaningful choice' to become a trader , what next would you suggest?

Please do, I want to hear the specifics. I'm sure that you are not just full of regurgitated bland statements about the nature of trading.

What discussion? I am patiently waiting for the original poster to elaborate on his 'logical method'.......my future success might well depend upon it.

Johnathan "To make money in the Forex market we need 3 things. These are; A logical method Solid Mindset Good Money Management technique" I think you are right but just to make sure we are on the same wavelength could you define in about three sentences your understanding of a 'logical method'? Many thanks for your informative articles.

Mysticforex.....totally agree with your logic. I mostly trade the AUD/USD Futures on a 30min timeframe and the high probability trades are always selling into supply/resistance in a downtrend and buying support/demand in an uptrend. Sounds easy but as always the task is to correctly identify trend as well as support/resistance. Personally I use linear regression to define slope and TSI to identify overbought/oversold conditions. Nothing magical about what I use, it's the logic behind it which is important. I also accept that all my indicators will work well except for that last time at the turn of the trend but even then a bit of divergence can also serve to exercise caution. In the business of keeping trading as simple as possible I would say that the majority of my focus is trying to accurately identify trend.

Johnathon............the biggest myth for me is that there is somebody out there who is consistently profitable , has a winning system, and still wants to share it with me for a bargain price, or any price for that matter. Like all sales pitches there is certainly an element of truth in what you say even if it lacks substance.